JPMorgan Forecasts Global Economic Slowdown Driven by Soaring Energy Prices
New York, Tuesday, 26 May 2026.
Driven by soaring fuel costs reaching $1.20 per liter, JPMorgan warns the global economy faces a necessary slowdown to combat stubbornly high inflation, threatening higher unemployment rates.
The End of the Goldilocks Era
On May 22, 2026, economists at JPMorgan officially retracted their “Goldilocks scenario”—a highly favorable economic condition characterized by robust expansion and cooling price pressures [1][2]. This optimistic baseline has been shattered by the ongoing conflict involving Iran, which has severely disrupted global energy markets [1][2]. The fallout became starkly apparent on May 21, 2026, when average gasoline prices in the United States reached a four-year high of $4.56 per gallon, equivalent to approximately $1.20 per liter [1][2][3]. These soaring transportation and input costs have fundamentally altered the economic trajectory, forcing the bank to reduce its global economic growth forecast by roughly 0.25 percentage points [1][2].